NEW money always wants to be old, and in China -- home to the newest of the world's new money -- entire industries have grown up around the desire to give that cash a bit of class.
There are only so many diamond iPads and Louis Vuitton sets a billionaire can buy in a lifetime. So now wealthy Chinese are looking for other ways to splurge, and they are discovering a passion for that richest of rich men's toys: the thoroughbred racehorse.
Irish bloodstock giant Coolmore Stud yesterday signed a contract with China's horse racing industry.
The contract, worth almost €40m over three years, will involve setting up a stud farm stocked with over 100 thoroughbred breeding mares sourced in Ireland and the acquisition of proven racing stallions.
The Tianjin complex will cover 870 acres and include two international standard racetracks, five training tracks, an equestrian college, horse auction house, 4,000 horse stalls and 150 trainers' offices. The racing venture and racecourse will require 600 to 800 horses for its inaugural year, with the aim of about 40 race days.
The deal couldn't have come at a better time for the Irish bloodstock industry. You wouldn't have known it by the crowds at Aintree at the weekend, but the sport of kings is going through a tough time.
Attendance across Ireland's 26 racetracks last year was almost 20pc below the peak levels in 2007, when 1.46 million people passed through the turnstiles. The number of new owners entering the market is dropping and the average number of horses in training fell more than 12pc to 5,030 last year - the lowestin 10 years.
Equine auction houses such as Goffs have also seen their sales figures plummet. Prize money has fallen to its lowest level since 2002 -- just €44.4m. Bookmakers' betting on-course slumped more than 9pc to €97.5m last year.
The figures are a far cry from the boom years. Even in 2008, prize money stood at more than €60m, and more than 12,000 horses were in training.
In 2007, over €61.3m was gambled on the Tote, while on-course bookmakers took in more than €205m.
But racing remains a large part of Ireland's tourism offering and the industry is also a big employer in rural parts -- from stable lads, farriers and vets to feed and bedding suppliers. More critically, it provides a shop window for the valuable bloodstock industry.
Ireland is the main producer of thoroughbred colts in Europe, and the third-biggest exporter after the US and Australia.
Each year, some of the world's top flat horses are bred and trained here and we account for about one-10th of world foal production-- although in recent years this has also been falling.
Bloodstock earnings, rather than prize money on the track, have long been where the big fortunes were made, with the best stallions commanding six-figure sums to cover a brood mare -- the so-called nomination fees.
Little wonder then that the usually media-shy Coolmore boss John Magnier Junior described the Chinese contract as a great deal.
China lifted a 60-year ban on horse racing last year, allowing weekly races to be conducted in the central city of Wuhan.
Macao is the only place in a gambling-crazy country of 1.3 billion people where it is legal to bet. China's frustrated gamblers are corralled into a tiny peninsula, where they spend an average of 1.4 days losing bucket-loads of money. Last year they left about $20bn on the table (of which Macao's government takes a 40pc cut), some four times the amount Americans contributed to the casinos of Las Vegas. Communist authorities banned horse racing after taking power in the 1949 revolution as part of a clampdown on anything smacking of luxury and decadence. Apart from the state lottery, nearly all forms of betting remain out of bounds for the Chinese, who are traditionally big gamblers.
China's nouveau riche are taking to horse racing with a vengeance. Several cities are positioning themselves for the eventual full legalisation of betting on races, which is expected in a few years. Developers are investing heavily in horse-related facilities, including hotels, shopping centres and racing. Owning a race horse is fast becoming the ultimate status symbol for wealthy Chinese.
Yesterday's deal is a sure winner for Ireland's economy and will breathe new life into a sector that badly needs it. When you are a world leader in the bloodstock industry, this is exactly where you want to be.